Multifamily leasing in 2023 looked a lot like it did in 2019, with seasonal patterns of peaks and dips, according to MRI Software’s latest data.

MRI Software’s data, compiled from more than 1 million market-rate units over five consecutive years, showed similarities between 2023 and 2019. Both years saw rents increase by nearly 7% from January to an in-year peak, then fall from that peak by 2.2% by the end of the year while delivering rent growth exceeding 4%.

“Budget-wise, the return to seasonality is a relief for landlords,” said Brian Zrimsek, industry principal at MRI Software. “It’s much easier to make forecasts when established market patterns reemerge.”

However, a few notable differences between 2023 and 2019 were cited. These include:

  • Renters chose to renew at a 10% higher rate in 2023 than in 2019;
  • Concession volumes were lower in 2023, but the relative values of concessions were nearly double what they were to help take the edge off new lease pricing;
  • Although 2023 showed signs of improvement after sustained underperformance in 2021 and 2022, 2019 had a better rent-payment performance, a difference of 1.5%; and
  • While nearly 89% of e-payments were processed using ACH in January 2019, that share was down to 61% in December 2023. Credit or debit card payments made up the vast majority of the remaining e-payments last year, even though residents face associated fees.

Looking ahead to the coming year, MRI noted that operators must understand the impacts of new deliveries and absorption in their local markets as they consider pricing and renewal strategies for 2024 and 2025. In addition, it expects rent growth to be more tempered in markets experiencing large delivery volumes and the challenge associated with competitive lease-ups.

“I’m anticipating that rent growth will align with pre-pandemic norms,” added Zrimsek. “That means small but steady increases.”

However, he noted that he wouldn’t throw away the crystal ball yet, citing many factors, including the supply surge, interest rates, remote-work policies, potential public health outbreaks, global conflicts, and the upcoming election, that could impact the multifamily industry in 2024.